Now that a bill to remake the state's business incentives has cleared the Legislature, stakeholders have turned their attention to how and when Gov. Chris Christie will tweak the Economic Opportunity Act through an expected conditional veto.

One section that could find the chopping block is a requirement for prevailing wages — effectively meaning union labor — for post-construction building services at projects that receive tax breaks, insiders have said. Development advocates support removing the mandate, partly because projects helped by the incentives could be added to existing buildings that already have those contracts in place.

"It's a tough thing to administer," said Michael McGuinness, the New Jersey chapter CEO of the development group NAIOP. He said it may "cause people to take a second to look" — or even discourage them from going into an existing project, as "it gets confusing, and it's very difficult to piecemeal the building maintenance."

The incentives bill was sent to the governor's desk on Monday, when the Senate passed an Assembly version adopted in late June. The measure would consolidate five incentive programs into two, expand eligibility and place a greater focus on job creation, among other moves aimed at making New Jersey more competitive with other states.

Insiders have long said they expect Christie to conditionally veto the measure, but the prospect looms larger after Monday's vote. During the Senate session, its top sponsors said they still took issue with some sections, but did not want to risk further delays after the negotiations and amendments that kept it from reaching his desk months earlier.

Sen. Raymond Lesniak, its chief sponsor in the Senate, repeated hopes that Christie strikes a requirement for residential builders who receive subsidies, that they set aside 20 percent of their units for affordable housing. He hopes the governor will make the set-aside an option for municipalities, he said, and he's also asked Christie to return the bill with $200 million in tax credits for redeveloping older low-income housing projects, he said.

"There's no money in this bill for affordable housing," Lesniak said. "Certainly the 20 percent set-aside isn't going to create any affordable housing. It makes it impossible to do any housing in cities, because the middle-class families that are going to buy these units won't be able to subsidize the low-income families."

McGuinness said "it's a good thing to allow some municipal discretion there," because cities like Trenton and Passaic "may very well have sufficient low- and moderate-income in their communities, and are trying to attract the middle class."

Share This Story On:

Joshua Burd

Josh Burd covers real estate, economic development and sports and entertainment. Before joining NJBIZ in 2011, he spent four years as a metro reporter in Central Jersey. His email is joshb@njbiz.com and he is @JoshBurdNJ on Twitter.